Financial Analysis Report of Crown Resorts Limited

RUNNING HEAD: ACCOUNTING FINANCIAL ANALYSIS REPORT
financial analysis

Accounting financial analysis report 1
Contents
Financial performance...........................................................................................................................2
Income statement...............................................................................................................................2
Balance sheet.....................................................................................................................................3
Ratio analysis........................................................................................................................................4
Profitability........................................................................................................................................4
Efficiency..........................................................................................................................................6
Leverage............................................................................................................................................6
Market value......................................................................................................................................8
DuPont analysis...................................................................................................................................10
References...........................................................................................................................................11

Accounting financial analysis report 2
Financial performance
Income statement
For analysing the profit and loss statement of Crown Resorts Limited, a horizontal and
vertical analysis is been performed for the year 2016 and 2017. From the items of the
statement, the figures for sales, EBIT, and net income is been analysed first to know about
the financial performance of the company. From the below graph, it can be observed that
both the operating profit and net income of the firm has risen over the two years while its
revenue has been decreased. The reason for this downfall was the 48.9% decline in the
revenue of VIP program play and weakness in the Perth economy. In addition to that, the
flooring game revenue decreases by 1.4% which impact the overall sales of Crown Resorts
(Crown Resorts. 2017).
Despite the increase in the operating expenses the EBIT rises in 2017 as compared to 2016.
This was due to a significant increase of 38% in the operating income of the firm. Along with
this, the net income of the company also rises from $948 million to $1866.1 million showing
an upsurge of 97%. This was basically due to the high profits generated from the proceeds of
the Crown's interest in MRE that resulted in a net gain of $1.7 billion (Crown Resorts. 2017).
2016 2017
0.0
500.0
1,000.0
1,500.0
2,000.0
2,500.0
3,000.0
3,500.0
4,000.0
Aanlysis of sales, net income and EBIT
Sales EBIT Net Income

Accounting financial analysis report 3
Apart from this, talking about the EBITDA of the company reduces from $861.4 million to
$790.3 million, reflecting a downfall of 8%. Reason is the reduction in revenue of VIP
program and the challenging economy of Perth.
Balance sheet
The statement of financial position of the company shows the balance of all the assets and
liabilities of the company along with the amount of equity. When analysed it was observed
that the total assets of Crown Resort reduce by 4% over the past two years. The same goes for
the liabilities of the firm. They have also shown a decrease of 3% in 2017. However, the
equity capital of the company rises, reflecting a 3% increase as a whole. This was due to a
significant upsurge in the retained earnings of the company. Apart from this, the non-current
liabilities and long-term debt of Crown Resorts has also reduced over the year, making the
company less risky (Crown Resorts. 2017).
2016 2017
0.0
1,000.0
2,000.0
3,000.0
4,000.0
5,000.0
6,000.0
7,000.0
8,000.0
9,000.0
10,000.0
Aanlysis of assets, liabilities and equity
Assets Liabilities Equity
Ratio analysis
Profitability
The ROA indicates the amount of income generated by the companies from their assets. The
below graph shows the returns made by Crown resort and SkyCity over the past five years. It